Tag: fx

Dollar repatriation? Different story told by cross currency swap

Intro Cross-currency basis swaps, also known as basis swaps, are contracts in which two counterparties agree to exchange interest payments according to two floating rates as well as notional principals denoted in two different currencies. Theoretically, covered interest rate parity should hold in absence of arbitrage opportunities. Here S and F denote the spot and […]

Brazil’s “Real” Struggle: what’s next?

In this article we are going to analyse Brazil’s next General elections, scheduled to be held on October 7 (i.e. today). The first section will present some basic information about Brazil and a brief background on the current political situation. The second part will present key factors on the Brazilian economy and about the functioning […]

Volatility Play on the Hidden Gold-Yuan Peg

Reserve Currencies A reserve currency is defined as a currency held by government for international payment purposes. The most important usages are: Repay back international debt (generally issued in reserve currencies) Defend the domestic currency against depreciation Improve the government credit rating Reserve currencies are many. The IMF chooses the most important ones to peg […]

A Primer on FX Carry Trading

Carry Trades and the Interest Parity Condition The uncovered interest rate parity (UIP) condition states that, under risk neutrality, the gain from borrowing a low interest rate currency and investing in a higher interest rate one will, in equilibrium, be matched by an equally large expected loss by a depreciation of the high interest rate […]

Market Recap 07-05-2017

United States The S&P 500 closed the week at $2,399.29, a record high and up 0.63% when compared with the close of the previous week. During the week several important announcements have been released; first of all the Federal Reserve decided to leave interest rate unchanged at 0.75%-1.00% following the slowdown in growth experienced by […]

Market Recap 30-04-2017

United States After the French election relief and solid first quarter earnings reports the US equities finished the week higher. Slightly more than half of the S&P 500 has reported, showing positive signs of improving economic growth, with best performers tech and industrial companies. The S&P 500 after the rally at the beginning of the […]

Market Recap 23-04-2017

United States Amidst continued geopolitical uncertainty and mixed corporate earnings results, US equities experienced a week of sideways movement. Later in the week however, the major indices recovered some of their previous week´s losses as confidence in president Trump´s tax reforms strengthened again. US treasury secretary Steven Mnunich announced that a proposal for the tax […]

Market Recap 09-04-2017

United States US stocks took a break after last week gains. The S&P 500 fell 0.3% closing the week at 2355.54, while large-caps were flat with the Dow Jones at last week’s levels. One of the major drivers of financial markets was the FED releasing the minutes of its mid-March meeting. The minutes highlighted the […]

Czech Koruna Ready to Jump as CNB Removes Floor

The Czech koruna, the currency of an economically relatively small country, recently has gained much attention by an increasing number of speculators. They have been positioning themselves to benefit from a possible appreciation of the Czech currency. For three years, the Czech National Bank (CNB) has kept the koruna above the determined level of 27 […]

Market Recap 02-04-2017

United States The S&P 500 closed at $2,362.72, up 1.44% when compared with the beginning of the week, where opened at $2,329.11 following concerns about President Trump’s ability to secure the passage of the tax reform after failure of his healthcare reform. The other major U.S. equity indices, the Dow Jones Industrial Average and NASDAQ, […]

Market Recap 12-03-2017

United States The S&P 500 closed at $2,372.60, slightly depreciating when compared with the beginning of the week, where it was standing at $2,375.32, but still higher than the weeks’ low of $2,357.98. Similar was the fate of both the Dow Jones Industrial Average and the NASDAQ, as they closed at slightly lower levels than […]

Market Recap 05-03-2017

Market Recap 05-03-2017 United States Despite experiencing a downward correction towards the closing of the week, US equity indices reached new record levels. The Dow Jones Industrial Average reached a new record level by breaching the 21.000 mark. On Wednesday, it peaked at 21.115, to close the week at 21.005, its first loss in a […]

Market Recap 26-02-2017

United States Last week was a particular good one for American equities. Indeed, the Dow Jones Index scored four record high closures in a row, up 0.96% from last week’s close. Smaller gains were scored also by the S&P 500 (+0.69%) and the Nasdaq Composite (+0.12%). It is worth noting how the last S&P 500 […]

MARKET RECAP 15/03/2015

U.S. U.S. equities experienced a negative performance during the past week. Stocks suffered sharp losses also on Friday and the main indexes registered a decline for a third week in a row, finishing what has turned out to be a turbulent five-day trading stretch. The Dow Jones industrial average fell 136 points (-0.76%) to 17,749.13, […]

The Opec meeting: days of market turm-Oil

Several investors have kept an eye open on oil this week putting all their hopes in the long-awaited OPEC meeting held on Thursday. Opening this week at $80.50 per barrel, the decisions of the OPEC meeting provoked an intraday drop of 6.65 percentage points in Brent crude prices on Thursday, with the oil price reaching […]

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